An interesting argument that general counsel agree more readily to report to a COO if promoted

I read online that Morgan Stanley’s chief legal officer was to report to the company’s chief operating officer. The writer contrasted the situation with Thomas Russo who insisted on reporting to the CEO when he took the top legal role at AIG.

Then the writer noted that “it’s highly unlikely that the bank would have been able to bring someone in from the outside without having him report to the CEO.”

Then came the observation that warranted this post: “It’s a lot easier to swallow reporting to the COO when it comes with a promotion to GC.” If true, a CEO can promote someone internally to a general counsel position that doesn’t report to the CEO much more easily than with a recruit from outside. Sounds like a reasonable argument. Regardless, I still advocate that the top lawyer report to the top executive (See my post of March 8, 2010: upward reporting of chief legal officers with 15 references.).